Technology has become a vital part of doing business in the 21st century. To remain competitive, small- and medium-sized enterprises (SMEs) in Australia invest in IT solutions that can help them grow. There have been several initiatives and business trends that have spurred Australian SMEs to invest in IT. Here are five of them:
1. Temporary full expensing
Government tax concessions like the temporary full expensing programme play a significant role in encouraging IT investment. The programme, valid until 30 June 2023, lets SMEs deduct the cost of an asset used for work. Assets may include smartphones, tablets, computers, and other IT equipment. To claim the tax deduction, companies must have purchased and installed the asset within the financial year. This allows companies to save taxes on their IT expenses and have more money to reinvest back into the business.
2. SME Recovery Loan Scheme
The SME Recovery Loan Scheme provides eligible businesses with guaranteed loans of up to $5 million to recover from the effects of the COVID-19 pandemic. The Australian Government has given participating lenders increased capacity to provide cheap credit loans with lower financing fees. Eligible businesses will have until the end of June 2022 to apply for this loan scheme.
This scheme gives eligible businesses extra working capital to invest in their growth. IT solutions are one of the areas in which companies can invest their loan to improve their digital operations and online presence. Significant loans will benefit businesses looking to implement more advanced server hardware, network infrastructures, and cybersecurity frameworks.
3. Technology investment boost
The Federal Government has dedicated $1.6 billion of its 2022–23 budget for small-business technology investments to incentivise digital adoption. The incentive ends on 30 June 2023, enabling businesses to deduct an additional 20% of the costs incurred on new technology. Hence, this means that for every $1,000 that companies spend on their digital transformation efforts, they can deduct $1,200. Eligible technology expenses include electronic invoicing systems, computer hardware, cloud platforms, and cybersecurity software, among others. Annual expenditures are capped at $100,000, but this levels the playing field for businesses with limited resources to invest in groundbreaking technology.
4. Energy Efficient Equipment Financing (EEEF)
The EEEF provides businesses discounts on financing energy-efficient equipment, vehicles, and projects. Companies may also get 100% financing on the equipment cost if the total investment is at least $20,000. Like the technology investment boost, the EEEF incentivises Australian SMEs to invest in digital technology. Businesses can improve their operational efficiency and reduce carbon tax by doing so. Modern employees are also more environmentally conscious, so companies that adopt energy-efficient systems can better attract and retain staff.
5. Hybrid working trends
The COVID-19 pandemic forced many employees to work from home. As a result, businesses had to quickly adapt their IT systems and invest in new technology to enable remote work. However, as coronavirus cases decline throughout Australia, more employees want the flexibility of remote and in-office work arrangements.
Hybrid work brings new challenges in managing and implementing IT systems. SMEs that want to implement hybrid work arrangements need to invest in new tools, such as online communication platforms, document collaboration software and secure remote access solutions. By doing so, businesses can enable their employees to work productively from anywhere.
What’s more, hybrid work arrangements are now a key selling point for attracting top talent. As such, SMEs that prioritise the investment of mobile IT systems will have the edge over the competition.
If you are looking to invest in new IT solutions for your business, now is the best time. In addition to government incentives and hybrid working arrangements, professional IT support is more popular than ever. Empower IT, in particular, is a leading managed IT services provider that offers a broad range of expertise and solutions for businesses. Whether you’re looking to enable hybrid work, invest in cloud computing, or fortify your cyber defences, we can help you. Call us now for a free consultation.